Fairfax County has survived the economic downturn, but many hurdles remain as the county eyes a $50 million shortfall in the upcoming year, Fairfax County Board of Supervisors Chairman Sharon Bulova said in her annual State of the County address on Thursday.

"Fairfax County continues to face significant challenges," she said in a speech that will be televised on Fairfax County Cable Channel 16 beginning Friday. "Our economy is on a slow road to recovery from the worst recession in decades.

"We have adopted budgets during the past two years that have closed serious projected shortfalls, reduced spending in our $2.2 billion General Fund budget by about $200 million while remaining  sensitive to the taxpayer."

Bulova says there will be a projected budget shortfall of about $50 million for Fiscal Year 2012. If the county were to return to awarding raises to county and school employees, as recently proposed by FCPS Superientendent Jack Dale,that shortfall would increase by more than $100 million, Bulova said.

Still, $50 million is less than the $640 million shortfall of two years ago and the $250 million one last year, Bulova pointed out.

"We are moving in the right direction," Bulova said. "We have already adapted changes to address previous shortfalls. It is a challenge, but we are Fairfax County, and we are up for a challenge."

Supervisor John C. Cook (Braddock District) says he thinks the budget deficit might actually be twice what Bulova estimates. Cook, speaking to reporters after the speech, says property values have risen slightly, so tax rates should abate slightly. That means relief to taxpayers, but a bigger gap for the budget, he said.

The county's budget will be released Feb. 22 and will be voted upon on April 26.

Bulova's highlights of 2010:

* Progress towards turning Tysons Corners into a compact, walkable, transit-oriented community. One the keys: Rail to Dulles Phase I is on track to begin by the end of 2013.

* Final completion of the Fairfax County Parkway.

* Despite budget cutbacks, Fairfax County Schools remain in top fifth percentile in the nation and crime remains low.

Things to look for in 2011:

"Four major issues are on our plate for 2011: Another challenging budget situation, redistricting, elections and BRAC [Base Realingment and Closure]," Bulova said..

* When more US Census number sare released in February, the Board of Supervisors will begin redrawing lines in the nine  districts. Bulova predicts changes to Hunter Mill, Springfield and Mount Vernon districts.

Former Board of Supervisors Chair Katherine Hanley will chair the citizen's committee to assit and advise the Board on changes. The final redistricting plan will not be adopted until at least April, Bulova said.

* BRAC will move 14,000 jobs to Ft. Belvior, bringing with it transportation challenges.

"The goal for the BRAC moves is to minimize the impact on Fairfax County residents and commuters and also to identify economic development opportunities these relocations will provide," said Bulova.

Bulova also said she will focus on redevelopment of communities such as Tysons, Merrifield, McLean, Springfield, Annandale, Baileys Crossroads and the Richmond Highway Corridor; encouraging innovation and collaboration for energy that is clean, efficient, sustainable, secure and reliable; identifying and fostering the emergence of new industry sectors (such as energy and green technology, biotechnology and tourism) ; and investing in transportation.

"Fairfax County is always in the process of reinventing itself," said Bulova. "Originally a county of dairy farms, then a suburban community to downtown Washington, we have evolved into what Time magazine describes as 'a job machine'

"We cannot stand still," she said. "Industries have their ups and downs, and we will ensure our continued success by diversifying the industries that call Fairfax County home."